PIR Corporation Has 2 Support Departments and 2 Operating Departments

question 129

Multiple Choice

PIR Corporation has 2 support departments and 2 operating departments. Number of employees is used as an allocation base for personnel support costs, and square metres are used for janitorial support costs. A breakdown of their costs, along with other operating information, is shown below for a recent accounting period: Support Departments Operating Departments
Personnel Janitorial Assembly Finishing
Direct Costs:
Fixed $ 8,000 $ 4,000 $ 3,000 $ 4,000
Variable 6,000 10,000 12,000 6,000
Total $14,000 $14,000 $15,000 $10,000
Number of employees 10 15 30 20
Square metres 3,000 5,000 10,000 10,000
If PIR uses dual-rate allocation and the direct method, the variable cost allocation rate for janitorial services will be:

• A)$0.50 per square metre
• B)$0.61 per square metre
• C)$0.70 per square metre
• D)None of the above

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Definitions:

Isovolumetric Contraction

A phase of the cardiac cycle where the ventricles contract with no change in volume, occurring between the closure of the atrioventricular valves and the opening of the semilunar valves.

Semilunar Valves

Heart valves located at the bases of the large arteries that leave the heart; they prevent blood from flowing back into the heart.

AV Valves

The atrioventricular valves, consisting of the tricuspid and mitral valves, regulate blood flow from the atria to the ventricles in the heart.

Left Ventricle

The chamber of the heart that receives oxygen-rich blood from the left atrium and pumps it out to the body through the aorta.